Ochu
JF-Expert Member
- May 13, 2008
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TANZANIA Electric Supply Company (TANESCO) says it wont rule out the possibility of entering into a new contract with the controversial Dowans Holdings Company or buy its Dar es Salaam-based power plant in the wake of the latest national energy crisis.
Purchase or no purchase depends on various factors -- price, purchasing process and the need. Were examining all options, TANESCO Managing Director Dr Idris Rashidi said in an interview.
He made the remarks when asked if his firm had any intentions to hire or make an outright purchase of the existing turbines from Dowans after the malfunctioning of gas-powered turbines operated by Songas knocked off 110 MW from the national power grid.
Government terminated a previous contract for the supply of 100 MW of emergency power by Dowans, which inherited a deal signed by the dubious Richmond Development Company.
However, Dr Rashidi insisted that it was too early to know the governments course of action, until an assessment of the situation by engineers from the General Electric (GE) company of the US was concluded.
First we need to know whether the breakdown is for a very short-term (say one week) or for a month (or two), he said.
He explained that the GE engineers, who were expected to arrive in Dar es Salaam at the weekend, would submit a technical report after assessing the situation.
The controversial contract between TANESCO and Dowans was terminated effective August 1, this year, after much legal wrangling.
There are already fears of sabotage in the sudden malfunctioning of the Songas turbines, thus effectively creating a new energy crisis in the country that could trigger off the commissioning of another dubious emergency power deal.
Since TANESCO pays millions of dollars in standby fees (capacity charges) to Songas each month, was there no provision in the contract that required Songas to constantly report to TANESCO on the maintenance status of the power plant and its turbines? queried an industry source.
He added: I find it very strange that the turbines operated by Songas would suddenly shut down one by one. Theres something fishy in all of this.
Dr Rashidi said he hopes that the problem with the Songas turbines was just a temporary breakdown.
The abrupt failure of the Songas turbines has forced TANESCO to introduce a 10-hour power shedding schedule currently crippling the nation.
Power shut-downs will adversely affect our customers -- small and large. It will cause disruption of economic and social activities, he said.
He noted that the power cuts not only affected the public utilitys turn-around goal, they also had severe consequences for the national economy.
One shilling lost in electricity sales has an impact of almost three shillings on the economy. So the impact on the economy is more important in this regard, the former central bank governor said.
He added that the financially-troubled TANESCO was on course to achieving profitability by 2011.
We are on track ... actually ahead on that target, he said.
Dr Rashidi said TANESCO was finalizing the national Power System Master Plan that would soon be formally presented to the government for adoption.
The initial recommendation is that we should have a reserve margin of 15 per cent. Thats, we should have excess generation facility to cover 15 per cent of our electricity, he said, adding This power security is very important if we are to avoid problems like this (power cuts). This is the practice all over the world and we have to implement same to avoid these problems going forward.
Songas generates a total 190 MW at its plant in Dar es Salaam, where TANESCO also runs its own gas-powered plant that produces another 100 MW.
TANESCO plans to add another 45 MW from natural gas to the grid by 2009 and another 200 MW the following year.
The public utility has an installed capacity of 1,212 MW, of which 562 MW is from hydro dams. It projects annual demand will rise to more than 1,100 MW by 2010.
Tanzania experienced massive power cuts in 2006 after drought hit TANESCOs hydro power production.
This led to the signing of dubious power purchase agreements with Richmond and subsequently Dowans, resulting into a scandal that forced the resignation of former Prime Minister Edward Lowassa and two senior cabinet ministers -- Nazir Karamagi and Dr Ibrahim Msabaha.
source: ThisDay
Purchase or no purchase depends on various factors -- price, purchasing process and the need. Were examining all options, TANESCO Managing Director Dr Idris Rashidi said in an interview.
He made the remarks when asked if his firm had any intentions to hire or make an outright purchase of the existing turbines from Dowans after the malfunctioning of gas-powered turbines operated by Songas knocked off 110 MW from the national power grid.
Government terminated a previous contract for the supply of 100 MW of emergency power by Dowans, which inherited a deal signed by the dubious Richmond Development Company.
However, Dr Rashidi insisted that it was too early to know the governments course of action, until an assessment of the situation by engineers from the General Electric (GE) company of the US was concluded.
First we need to know whether the breakdown is for a very short-term (say one week) or for a month (or two), he said.
He explained that the GE engineers, who were expected to arrive in Dar es Salaam at the weekend, would submit a technical report after assessing the situation.
The controversial contract between TANESCO and Dowans was terminated effective August 1, this year, after much legal wrangling.
There are already fears of sabotage in the sudden malfunctioning of the Songas turbines, thus effectively creating a new energy crisis in the country that could trigger off the commissioning of another dubious emergency power deal.
Since TANESCO pays millions of dollars in standby fees (capacity charges) to Songas each month, was there no provision in the contract that required Songas to constantly report to TANESCO on the maintenance status of the power plant and its turbines? queried an industry source.
He added: I find it very strange that the turbines operated by Songas would suddenly shut down one by one. Theres something fishy in all of this.
Dr Rashidi said he hopes that the problem with the Songas turbines was just a temporary breakdown.
The abrupt failure of the Songas turbines has forced TANESCO to introduce a 10-hour power shedding schedule currently crippling the nation.
Power shut-downs will adversely affect our customers -- small and large. It will cause disruption of economic and social activities, he said.
He noted that the power cuts not only affected the public utilitys turn-around goal, they also had severe consequences for the national economy.
One shilling lost in electricity sales has an impact of almost three shillings on the economy. So the impact on the economy is more important in this regard, the former central bank governor said.
He added that the financially-troubled TANESCO was on course to achieving profitability by 2011.
We are on track ... actually ahead on that target, he said.
Dr Rashidi said TANESCO was finalizing the national Power System Master Plan that would soon be formally presented to the government for adoption.
The initial recommendation is that we should have a reserve margin of 15 per cent. Thats, we should have excess generation facility to cover 15 per cent of our electricity, he said, adding This power security is very important if we are to avoid problems like this (power cuts). This is the practice all over the world and we have to implement same to avoid these problems going forward.
Songas generates a total 190 MW at its plant in Dar es Salaam, where TANESCO also runs its own gas-powered plant that produces another 100 MW.
TANESCO plans to add another 45 MW from natural gas to the grid by 2009 and another 200 MW the following year.
The public utility has an installed capacity of 1,212 MW, of which 562 MW is from hydro dams. It projects annual demand will rise to more than 1,100 MW by 2010.
Tanzania experienced massive power cuts in 2006 after drought hit TANESCOs hydro power production.
This led to the signing of dubious power purchase agreements with Richmond and subsequently Dowans, resulting into a scandal that forced the resignation of former Prime Minister Edward Lowassa and two senior cabinet ministers -- Nazir Karamagi and Dr Ibrahim Msabaha.
source: ThisDay
